Does California’s hot job market justify a fatter state budget?

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In this Wednesday, Jan. 10, 2018 photo, Gov. Jerry Brown points to a chart showing the growth of the state’s Rainy Day fund as as he discusses his proposed 2018-19 state budget at a news conference in Sacramento, Calif. Brown and legislative leaders say they’ve reached an agreement on a state budget for California. Brown announced the deal Friday, June 8, 2018, but released few details. He says the agreement boosts funding for schools and universities, creates an online community college, adds to the rainy day fund, expands subsidized child care and combats homelessness and poverty. (AP Photo/Rich Pedroncelli)

What’s seemingly lost in the dialogue is why there’s this pot of gold to fight over in the first place.

Let’s give credit where it’s due: California’s private-sector employers. While politicos and pundits alike were bickering, bosses have been hiring at a top-of-the-charts pace. Overall economic performance has largely powered the reversal in the government budget.

Let’s look at what my trusty spreadsheet has to sayabout California’s private sector hiring — jobs and pay, comparing the fourth quarters of 2011 and 2017 using federal employment data.

1. Hiring: 2.36 million workers hired statewide from 2011 to 2017, the most workers added among the states. It’s also equal to 17 percent of all new U.S. workers. (California’s 14.8 million workers are 12 percent of all U.S. jobs )

2. Job growth: California’s hiring spree equaled a 19 percent growth rate in 2011-17, No. 7 nationally (Utah was No. 1 by this metric) and outpacing the average 12 percent hiring pace among all other states.

3. Salaries: Private employers in the state paid an average $1,354 weekly wage in 2017’s fourth quarter — 26 percent higher than other states. California wages rose 23 percent in 2011-17, the No. 2 hike nationally (Washington state was No. 1) and larger than the average 15 percent growth in other states.

4. Payrolls: The growing number of jobs and rising wages adds up to 47 percent growth in what private bosses collectively paid Californians in 2011-17. That’s your growing base for income taxes and consumption-based levies like sales tax. (And this helps explain a 60 percent home-price increase in this period!) That payroll growth is second-largest, again behind Washington. Nationwide, total pay grew by only 29 percent.

5. Gross Domestic Product: This broadest measure of business output confirms California’s economic oomph. From 2011 to 2017, the state’s GDP grew 22 percent after inflation, fourth best among the states.

Look, this employment growth doesn’t justify all spending decisions or tax policy. But it certainly suggests one reason why the government has extra opportunities to spend. Note that private industry payroll expansion is not the only fattened target for taxation. Don’t forget about government worker pay, capital gains and property values, to name a few.

Plus, this economic rebound was from an ugly bottom. California’s economy — and state coffers — were hammered by the Great Recession.

For example, private employers cut 891,000 workers from 2007 to 2011– a 7 percent drop that was 10th worst in the nation. California’s GDP contracted 2 percent.At the same time, state government spending fell 9 percent in those four years.

I will let other’s debate state spending priorities, the funding choices made, who should pay and how much — no less do we get “value” out of our tax dollars.

But let’s not forget the backdrop of this current political debate: Noteworthy California wealth created by the economic recovery.

Jonathan Lansner has been the Orange County Register's business columnist since 1997 and has been part of the newspaper's coverage of the local business scene since 1986. He is a native New Yorker who is a past national president of the Society of American Business Editors and Writers and a graduate of the University of Pennsylvania's Wharton School. Jon lives in Trabuco Canyon -- yes, a homeowner -- and when he's not fiddling with his trusty spreadsheet at work you can likely find him rooting for his beloved Anaheim Ducks or umpiring local lacrosse games.